Corporate Economists See Slower Growth

The U.S. economy will probably grow in the second half of 1998 at a slower pace than the first quarter’s annual rate of 5.4%, fueled by strong consumer demand and tame inflation, the National Assn. for Business Economics said. The NABE’s latest quarterly survey of 110 corporate economists, conducted during June and July, found that 60% said they are expecting the economy to grow at an annual rate of 2% to 3% in the last six months of the year. Twenty-six percent of those surveyed expect growth of 1% to 2%, while about 12% anticipate growth above 3%. Just 2% expect growth of 1% or less. About 62% expect their companies’ sales volume to increase in the period. Also, 35% said they planned to hire more workers over the next six months, while about 13% said they planned cutbacks. The survey also found that 39% said prices would be unchanged from 1997 levels this year. Twenty-two percent see price increases of less than 2%, and 24% see increases of more than 2%. Almost 16% plan price cuts.